Revenue Recognition

12 Months Ended

Dec. 31, 2019

Revenue from Contract with Customer [Abstract]

REVENUE RECOGNITIONEffective January 1, 2018, the Company adopted ASC 606, “Revenue from Contracts with Customers,” using the modified retrospective method applied to those contracts which were not completed as of January 1, 2018. Under the modified retrospective method, the Company recognizes the cumulative effect of initially applying the new revenue standard as an adjustment to the opening balance of retained earnings; however, no material adjustment was required as a result of adopting ASC 606. Results for reporting periods beginning on January 1, 2018 are presented under the new revenue standard. The comparative information has not been restated and continues to be reported under the accounting standards in effect for those periods. The

Company performed an analysis of the impact of adopting ASC 606 across all revenue streams and did not identify any changes to its revenue recognition policies that resulted in a material impact to its consolidated financial statements.

Revenues from Contracts with Customers

Natural gas and liquids. Natural gas, oil and NGL sales are recognized when control of the product is transferred to the customer at a designated delivery point. The pricing provisions of the Company’s contracts are primarily tied to a market index with certain adjustments based on factors such as delivery, quality of the product and prevailing supply and demand conditions in the geographic areas in which the Company operates. Under the Company’s sales contracts, the delivery of each unit of natural gas, oil and NGLs represents a separate performance obligation, and revenue is recognized at the point in time when the performance obligations are fulfilled. There is no significant financing component to the Company’s revenues as payment terms are typically within 30 to 60 days of control transfer. Furthermore, consideration from a customer corresponds directly with the value to the customer of the Company’s performance completed to date. As a result, the Company recognizes revenue in the amount to which the Company has a right to invoice and has not disclosed information regarding its remaining performance obligations.

The Company records revenue from its natural gas and liquids production in the amount of its net revenue interest in sales from its properties. Accordingly, natural gas and liquid sales are not recognized for deliveries in excess of the Company’s net revenue interest, while natural gas and liquid sales are recognized for any under-delivered volumes. Production imbalances are generally recorded as receivables and payables and not contract assets or contract liabilities as the imbalances are between the Company and other working interest owners, not the end customer.

Marketing. The Company, through its marketing affiliate, generally markets natural gas, oil and NGLs for its affiliated E&P companies as well as other joint owners who choose to market with the Company. In addition, the Company markets some products purchased from third parties. Marketing revenues for natural gas, oil and NGL sales are recognized when control of the product is transferred to the customer at a designated delivery point. The pricing provisions of the Company’s contracts are primarily tied to a market index with certain adjustments based on factors such as delivery, quality of the product and prevailing supply and demand conditions. Under the Company’s marketing contracts, the delivery of each unit of natural gas, oil and NGLs represents a separate performance obligation, and revenue is recognized at the point in time when the performance obligations are fulfilled. Customers are invoiced and revenues are recorded each month as natural gas, oil and NGLs are delivered, and payment terms are typically within 30 to 60 days of control transfer. Furthermore, consideration from a customer corresponds directly with the value to the customer of the Company’s performance completed to date. As a result, the Company recognizes revenue in the amount to which the Company has a right to invoice and has not disclosed information regarding its remaining performance obligations.

Gas gathering. Prior to the Fayetteville Shale sale in December 2018, the Company, through its midstream gathering affiliate, gathered natural gas pursuant to a variety of contracts with customers, including an affiliated E&P company. The performance obligations for gas gathering services included delivery of each unit of natural gas to the designated delivery point, which may include treating of certain natural gas units to meet interstate pipeline specifications. Revenue was recognized at the point in time when performance obligations were fulfilled. Under the Company’s gathering contracts, customers were invoiced and revenue was recognized each month based on the volume of natural gas transported and treated at a contractually agreed upon price per unit. Payment terms were typically within 30 to 60 days of completion of the performance obligations. Furthermore, consideration from a customer corresponded directly with the value to the customer of the Company’s performance completed to date. As a result, the Company recognized revenue in the amount to which the Company had a right to invoice and had not disclosed information regarding its remaining performance obligations. Any imbalances were settled on a monthly basis by cashing-out with the respective shipper. Accordingly, there were no contract assets or contract liabilities related to the Company’s gas gathering revenues.

Disaggregation of Revenues

The Company presents a disaggregation of E&P revenues by product in the consolidated statements of operations net of intersegment revenues. The following table reconciles operating revenues as presented on the consolidated statements of operations to the operating revenues by segment:


(in millions)	E&P		Marketing		Intersegment Revenues		Total
Year ended December 31, 2019
Gas sales	$	1,207	$	—	$	34	$	1,241
Oil sales	220		—		3		223
NGL sales	274		—		—		274
Marketing	—		2,849		(1,552)		1,297
Other ⁽¹⁾	2		1		—		3
Total	$	1,703	$	2,850	$	(1,515)	$	3,038

Year ended December 31, 2018
Gas sales	$	1,974	$	—	$	24	$	1,998
Oil sales	193		—		3		196
NGL sales	353		—		(1)		352
Marketing	—		3,497		(2,275)		1,222
Gas gathering ⁽²⁾	—		248		(159)		89
Other ⁽¹⁾	5		—		—		5
Total	$	2,525	$	3,745	$	(2,408)	$	3,862

Year ended December 31, 2017
Gas sales	$	1,775	$	—	$	18	$	1,793
Oil sales	101		—		1		102
NGL sales	206		—		—		206
Marketing	—		2,867		(1,895)		972
Gas gathering ⁽²⁾	—		331		(205)		126
Other ⁽¹⁾	4		—		—		4
Total	$	2,086	$	3,198	$	(2,081)	$	3,203

(1)Other E&P revenues consists primarily of water sales to third-party operators and other marketing revenues consists primarily of sales of gas from storage.

(2)The Company’s gas gathering assets were divested in December 2018 as part of the Fayetteville Shale sale.

Associated E&P revenues are also disaggregated for analysis on a geographic basis by the core areas in which the Company operates, which are primarily in Pennsylvania and West Virginia. In December 2018, the Company sold 100% of its Fayetteville Shale assets.


	For the years ended December 31,
(in millions)	2019		2018		2017
Northeast Appalachia	$	964	$	1,165	$	837
Southwest Appalachia	736		817		498
Fayetteville Shale	—		537		743
Other	3		6		8
Total	$	1,703	$	2,525	$	2,086

Receivables from Contracts with Customers

The following table reconciles the Company’s receivables from contracts with customers to consolidated accounts receivable as presented on the consolidated balance sheet:


(in millions)	December 31, 2019		December 31, 2018
Receivables from contracts with customers	$	284	$	494
Other accounts receivable	61		87
Total accounts receivable	$	345	$	581

Amounts recognized against the Company’s allowance for doubtful accounts related to receivables arising from contracts with customers were immaterial for the years ended December 31, 2019 and 2018. The Company has no contract assets or contract liabilities associated with its revenues from contracts with customers.